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Trust and Entrepreneurship

Trust and Entrepreneurship

A West–East Perspective

Edited by Hans-Hermann Höhmann and Friederike Welter

In this innovative book, international scholars investigate trust and its role in relation to the entrepreneurial behaviour of small firms across a variety of institutional and cultural settings. The contributors draw on original empirical material from a number of West European and East European countries, highlighting the role of culture and the significance of a multi-disciplinary approach in researching trust and its importance in entrepreneurship.

Chapter 6: Measuring Trust and Trustworthiness

Jonathan Leland, Daniel Houser and Jason Shachat

Subjects: business and management, entrepreneurship


Jonathan Leland, Daniel Houser and Jason Shachat1 INTRODUCTION Social scientists have long held the view that trust has a significant influence on the economic prosperity of nations. But researchers have only recently started to find empirical support for this belief. Up to now this empirical research has relied on measures of trust derived from responses to a very simple survey question. These measures are subject to two criticisms. The first concerns the meaning of the responses upon which they are based – what aspects of trust do responses to this question reveal? The second concerns whether the question is interpreted in the same manner across individuals and, more to the point, across cultures. In this chapter we propose that these problems are unavoidable – motivations for exhibiting a behaviour one might interpret as reflecting ‘trust’ can differ depending on the context in which the behavior occurs. We propose that these different motivations underlying trust can be understood and unconfounded using different scenarios drawn from the literature on game theory. We then examine how best to go about measuring trust in these different settings for the purposes of understanding if and how it might contribute to economic well-being. The chapter is developed as follows: first, we review common arguments as to why and how trust might contribute to economic prosperity as well as the literature indicating that trust, as measured by survey responses, does, indeed, have the expected effect. We also review some of the concerns that have been expressed regarding the measures...

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